In-Class Lecture 10/25/2010Monday, October 25, 2010 7:59 PM Write a 1/2 page report on this: (from ch. 10 Project Management PP) Went over Mid-Term first • See http://www.4pm.com/articles/wbs.pdf (please read) about the level of detail needed in a WBS: don’t micromanage. Project Management PowerPoint • Teams ○ Employees seem to like teams ○ Flattened hierarchies ○ Teams are successful Ought to be empowered Must be allowed to make mistakes (at least they are trying, companies sometimes reward this) With multi-functional teams that are composed of different areas of the business (marketing, sales, engineering, etc.) ○ Types: Tiger Teams □ High-powered, focused and time constrained Self-directed work teams □ Team identifies problems on its own May have customer complaints they may decide how to tackle the problem □ Virtual teams Do not meet physically Could be design teams (ie: from Asia, North America, Europe, etc. that meet only virtually) ◊ Could allow for around the clock work since the time is different in different group areas and would allow for online saving of documents (think Google Docs) • Project Types ○ Types: Derivative (incremental change) Platform (fundamental improvement) Breakthrough (major change – new markets) ○ Categories Product Change Process Change Research and development (advanced technology) Alliances and partnerships (capabilities beyond current level) ○ Structure: Pure Project □ Autonomous Aka skunkworks □ Single-project set-up □ Project manager has full-authority □ Apple often utilizes this Functional □ Comes from an existing division within a business Matrix Project □ Combination of the two □ Has section heads and Project Manager □ Project Manager overall responsible and meets customer □ May have central or decentralized power of managers involved • Gantt chart ○ Helpful for creating the activities together for a project ○ Help for seeing when milestones are met Or even when things are not going well or on time ○ Shows time and activity done during that time period ○ Set up like a X Y diagram Good break-down of the cost structure of the project Lecture Notes 10-4-2010 Page 1 ○ ○ • Critical Path Method 1. Identify all activities and their time durations 2. Determine their sequence, and construct a network diagram (activity on node) 3. Determine the critical path (‘forward pass’) 4. Determine the early start/ early finish times, and late start/ late finish times. (‘backward pass’) ○ When there are three activity time estimates, estimate the mean and standard deviation of each activity and do the CPM: mean = (a + 4m + b)/6, std.dev. = (b – a)/6 from this, one can compute average and standard deviation of the project completion time. This will help to compute the variability of the project Criticism of CPM • It assumes: ○ Activities are clearly identified and don't change over time ○ Sequential relationships are clearly identified ○ Project control should focus on critical path ○ Find crash times, and find the optimal project completion time. Lecture Notes 10-4-2010 Page 2 A is optimistic B is pessimistic time 4m gives weight (4X) to most likely course of action Squaring makes it variance, without it would be Standard Deviation M is most likely (is NOT average) Lecture Notes 10-4-2010 Page 3 Variances are only valid on the Critical Path (time constraints) T is normal (T = Project completion Time) Mean = 38 Variance = 11.89 Standard Deviation = 3.45 = 3.45 Square root of 11.89 (Probability) P(T<40) = P(Z > (40-38)/3.45) = Approximately 72% Project Completion Time = T is normal (from above) Time-cost tradeoff: It costs to expedite activity – due to activity direct costs (overtime, hiring, additional equipment) It costs to sustain activity – due to project indirect costs (overhead, opportunity costs, contractual terms) Find crash times, and find the optimal project completion time. Software Microsoft Project Primavera See http://infogoal.com/pmc/pmcswr.htm PMI: The Project Management Institute See www.pmi.org Lecture Notes 10-4-2010 Page 4 See www.pmi.org Next we Went over Lean, JIT, OM consulting, and Reengineering Powerpoint Lean/JIT • Developed by Toyota, Taiichi Ohno Eliminate Waste, especially inventory ○ Overproduction, waiting time, unnecessary transport, scrap, multi-task ○ WORMPIT: waiting, overtime, rework, motion, processing, inventory, transportation ○ Use Pull system (pull them to inventory) not push (push them into inventory storage = wasteful) Reduction in batch sizes in production reduces inventory and flow time ○ IE a batch of 100 with flow time, in a 4 stage process, of 100 mins would produce the first 100 in 400 mins ○ Batch size of 10 with flow time 10 would make 100 in only 140 mins Gets out quicker Prevents waste or inventory surplus □ THIS IS LEAN PRODUCTION Push Pull ○ Push is pushed into inventory ○ Pull doesn't run unless the market pulls it through manufacturing Building Blocks in Developing JIT and implementing ○ Product design (standard parts, modular design, flexible manufacturing systems, quality, concurrent engineering) ○ Process design (small lot size, set up time reduction, manufacturing cells, limited work in process, visual controls, improved quality, flexible production, lower inventory, reduced lead times, 5S) ○ Personnel (respect for workers, cross-training, continuous improvement, cost accounting, leadership v management) ○ Planning and control (level loading – mixed model sequencing, pull systems, visual systems, close vendor relationships, reduced transaction processing, preventive maintenance, reduced lead times) Comparison JIT thinking Inventor Liability y Lot size Minimum Set ups Reduce the time Quality Zero defects JIT in Services ○ Eliminate disruptions ○ Make the system flexible ○ Reduce setup times, processing times, lead times ○ Eliminate waste ○ Minimize work in process ○ Simplify the process (reengineer the process) JIT Advantages ○ Low inventory (less investment) ○ Quick response to design changes ○ If design is obsolete, not much is lost ○ Defect is immediately taken care of ○ Forces improvements – like faster change of dies in manufacturing ○ Increases flexibility, reduces lead time Traditional view Asset Formulas (EOQ) Not a priority Some scrap tolerated Cross trained workers are more effective Lecture Notes 10-4-2010 Page 5 ○ Use of smaller units of capacity allows ‘shifting’ of capacity ○ Use of off-line buffers reduces congestion ○ Reserve capacity for important customers (‘over capacity’) JIT Problems ○ JIT may degenerate to JIC ○ Any disruption causes a large impact “Living in Dell Time” – when ports closed, Dell airshipped vital parts ○ Inability to ramp up production quickly ○ No hedge against shortage in supply, or increasing prices ○ Cannot take advantage of quantity discounts ○ Too many ‘replenishments’ ○ Sometimes, those with power make others keep inventory Re-engineering ○ Based on original work of Hammer and Champy ○ “rethinking and radical redesign of business processes to achieve dramatic improvements in critical areas of performance” ○ Principles Organize around outcomes, not tasks Have those who use the output of the process perform the process Merge information-processing work into the real work that produces the information Treat geographically dispersed resources as though they were centralized Link parallel activities instead of integrating only their results Put the decision point where the work is performed, and build control into the process Capture information once – at the source ○ Tools Innovation □ IT □ Flow charts, value stream maps □ Creativity and innovation Lecture Notes 10-4-2010 Page 6
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